5 Reasons Not to Worry This Week

It's not a perfect world out there for investors, but things may be starting to get better.

A last-minute bailout deal will keep the financial system in Cyprus from being completely wrecked -- for now.

Closer to home, the housing market is the strongest it's been in years.

I recently went over some of the companies that are expected to post lower quarterly profits when they report this week. Thankfully, they're the exceptions and not the rule.

Let's go over some publicly-traded companies that are expected to stand tall this week by posting year-over-year improvement on the bottom line.

Company	Latest-Quarter EPS (estimated)	Year-Ago Quarter EPS
NuPathe (NASDAQ: PATH  )	($0.33)	($0.38)
SAIC (NYSE: SAI  )	$0.51	($0.49)
Paychex (NASDAQ: PAYX  )	$0.39	$0.37
GameStop (NYSE: GME  )	$2.09	$1.73
Mosaic (NYSE: MOS  )	$0.87	$0.64

Source: Thomson Reuters.

Clearing the table
Let's start at the top with NuPathe. NuPathe is a biotech focusing on neuroscience solutions for diseases of the central nervous system. NuPathe's finally ready to start turning its products into revenue. Zecuity was recently approved by the FDA for the acute treatment of migraine with or without aura in adults. NuPathe also has a couple of other potentially promising treatments in development.

Until NuPathe generates enough revenue to cover its operations, investors are braced for red ink. Analysts don't see a profit out of the company until 2015. The key to sticking around until then is keeping the cash burn in check, and on that front it's good to see NuPathe's losses narrowing.

SAIC is widely expected to reverse a quarterly deficit from a year earlier. The government contractor received some kind ink from Barron's over the weekend. An analysts sees as much as 34% upside from here for the stock, encouraged by the potential of SAIC spinning off its government information technology services unit. Unloading the business would allow it to make more government bids in areas that are currently not allowed given the conflicts of interest.

The one thing investors should keep in mind with SAIC is that Wall Street has had a nasty habit of overestimating the bottom line here. SAIC has come up short against profit expectations in three of the past four quarters.

Paychex is a leading provider of human resources outsourcing, though it's most commonly known for its payroll services. The company targets small and medium-size businesses where it's more cost-effective to have an outsider handle everything from paycheck processing to other administrative responsibilities.

From an economic perspective, it's encouraging to see Paychex moving in the right direction. Revenue and earnings are expecting to inch 4% and 5% higher, respectively, in Wednesday's report. These are baby steps, but at least they're not going backward.

GameStop is the country's top stand-alone retailer of video games and gear. Drive through the country and you'll see plenty of GameStop stores in strip malls. The small-box model works.

Unfortunately for GameStop, times are changing. Die-hard gamers aren't buying new systems and releases at the same rate that they used to. GameStop's feeling the pinch. The struggling retailer has lowered its same-store sales outlook four times over the past year. Share buybacks have keep profitability -- on a per-share basis -- at least growing.

The future will be iffy. New consoles are rumored to have features that prevent the usage of secondhand titles, and that's a trend that would sting GameStop's lucrative resale business. The chain derives its heartiest margins in marking up pre-owned games and gear, and that's a niche that has been declining faster than its shrink-wrapped sales.

However, the model is so well chiseled that GameStop continues to grow its bottom-line results despite the fading nature of its business.

Finally, we have Mosaic. The world's leading producer of phosphate crop nutrients had some good news for investors last week. A joint venture in Saudi Arabia was announced. Mosaic would own just a 25% stake in the venture -- and the operations to produce phosphate fertilizers won't begin for another three years -- but it's a smart way to grow its overseas presence.

When Mosaic reports on Thursday, analysts see a profit of $0.87 a share, well ahead of the $0.64 a share it posted a year earlier.

Cross those fingers, but know the fundamentals
Investors in these five stocks have a right to be excited. They are all improving their financial situations. They are worthy of the gains that the market rally has bestowed upon them over the past year.

I wouldn't be uncomfortable owning any of these companies. They're doing the right thing, regardless of Mr. Market's mood swings.

The expectations may be high, but these five stocks wouldn't have it any other way.

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